I would like to embed something like an excel document to my website which I could edit when I get new data. And be able to share a Word document with a friend and have us editing it both.

What is Google Docs? How does it work?

Google Docs is a service provided by google which allows you to type and edit documents online, store them online and save them to your desktop when needed. You can write word documents from on the road from no matter what computer and they will be saved in your google account. Basically it’s just like having Microsoft Office (Word, Excel, ...) on the web.

You can also make it available to everyone on the net simply by checking a box. When you did so you will be given a url to reach your document. You can link it from your website or embed it to your website using an iFrame. It will display like an html page. When you edit it and save it, changes will display instantly on the web.

If you want to work on a word document .doc or an excel spreadsheet .xls together with a friend of yours remotely you can allow your friend to access and edit the page.
In Google Docs select the document, click on Share and enter the e-mail address of your friend. An e-mail will be sent to him including a link. When he clicks on the link he needs to login to his google account and then can modify the document. The document will not be seen from anyone else as long as you don’t publish it to be seen from everyone. No one can see it or edit it unless you decide to allow them to.